Simple Policy, Complex Politics
This blog posting from Keith Hennessey is excellent in pointing out the long-term demographic challenges the United States faces with Social Security and Medicare. It cogently asserts that part of the growth in health and social spending is due to pure demographics.
"The rapid growth of per capita health spending in the U.S. is a critical policy problem that needs to be addressed. It is not, however, the primary driver of our federal budget problems over the next 30-40 years. The aging of the population is. Policy changes need to address both pressures to prevent an eventual fiscal meltdown. We must not ignore demographics."
Of course, the answer to this apparent policy conundrum is rather simple from a pure policy perspective: raise retirement and modify current benefits. Of course some would add tax increases into the policy option mix, but given the deleterious effects that would have on the economy I don't think the time is right to discuss that.
The sad fact is, this policy really is simple, it does not require a rocket scientist to recognize the fiscal oblivion waiting to hit us. However, no politician (or aspiring politician) could ever run on that platform, the politics is too complex and bad. The legitimate policy options to resolve this are automatically removed from serious consideration because no one really wants to face this issue square on.
This won't change in the near term, but somewhere, sometime something is going to have to give.
"The rapid growth of per capita health spending in the U.S. is a critical policy problem that needs to be addressed. It is not, however, the primary driver of our federal budget problems over the next 30-40 years. The aging of the population is. Policy changes need to address both pressures to prevent an eventual fiscal meltdown. We must not ignore demographics."
Of course, the answer to this apparent policy conundrum is rather simple from a pure policy perspective: raise retirement and modify current benefits. Of course some would add tax increases into the policy option mix, but given the deleterious effects that would have on the economy I don't think the time is right to discuss that.
The sad fact is, this policy really is simple, it does not require a rocket scientist to recognize the fiscal oblivion waiting to hit us. However, no politician (or aspiring politician) could ever run on that platform, the politics is too complex and bad. The legitimate policy options to resolve this are automatically removed from serious consideration because no one really wants to face this issue square on.
This won't change in the near term, but somewhere, sometime something is going to have to give.
Comments